Measuring What Matters: How eBay, Verizon Determine Marketing Spend
In a session at last week’s Shop.org conference in Las Vegas, Tony Flanery-Rye, senior director of growth analytics for eBay, and Andrea Wasserman, vice president, retail experience at Verizon, discussed how their respective companies are using analytics to help them inform marketing decisions.
When asked to describe his role at eBay, Flanery-Rye said he counts the things that count. With more than 1 billion SKUs in eBay’s catalog to analyze, he has plenty to work with. However, the attribution models used to evaluate the media/advertising spend performance for those products differ based on a number of factors, including the length of the purchase cycle as well as the product category itself.
“Multitouch attribution is great … if that’s what you want to get to,” Flanery-Rye said. “It really depends on the business. What do you sell, and how many [customers] are making multiple visits and how are many are just coming once. Last touch might work if you have a business where a customer is in and out with a purchase. For example, toys are a last-touch product for us. We adapt to the product.”
For Verizon, with its physical store presence in addition to its digital properties, Wasserman said the company measures the standard P&L metrics in the customer journey, but takes it a step further by monitoring its NPS score as well as customer surveys designed to provide data on perception of the brand and customers’ interactions with it.
“We’re looking at what’s happening in-store, and then correlate it back to online,” noted Wasserman. “And then vice versa. Examples of that include buy online, pick up in-store as well as in-store tap behavior.”
Wasserman cited an example of Verizon enabling its customers to set up their phones (e.g., contact lists, settings, etc.) outside of the store following a purchase in-store. The retailer wants to follow the experiences of its customers outside the store.
Incrementality is the Key to Optimizing Marketing Spend
When asked what their strategy was for allocating budget to various marketing channels, both Flanery-Rye and Wasserman said to follow the money. Universal metrics such as revenue and conversion rate will be always be important, but retailers need to take their analysis further to truly optimize marketing spend.
“Incrementality is the key — what would be the result if I took this piece out,” said Flanery-Rye. “Once you know incrementality, you test higher up the [sales] funnel. And we embrace the idea of failing fast. Testing is not a set it and forget it approach.”
Flanery-Rye noted that some attribution models such as multimix multimedia modeling take longer to create and can be more effective, there’s still value in using simpler models to make quick (i.e., daily) decisions.
For Verizon, the company has an impressive data-driven culture, Wasserman said. It’s focused on three pillars: people, process, and technology.
“We’re a team that’s focused on marketing effectiveness, including customer experience,” Wasserman said. “At the outset of a marketing initiative, we identify what success will look like, and how we’re going to measure it.
Verizon is using CX data to inform merchandising and testing strategies, Wasserman said. In addition, the retailer enjoys the benefit of data sharing with its brand partners. Lastly, a center of marketing effectiveness group within Verizon works to analyze metrics and measure what spend should be dedicated to in the future.
‘Your Competition is Every Other CX Out There’
To close the session, Flanery-Rye and Wasserman discussed the impact of company culture on marketing strategy, and the value in relying on data to make decisions — at least to an extent.
“Culture has to be impacting the way you’re making decisions,” Flanery-Rye advised. “Have a healthy bit of skepticism about what you’re seeing. You can always find some data or model that will help prop up your case.”
Wasserman advised the audience to look outside their product category and even industry to find innovation that can be applied to their own businesses.
“Competition is every other CX out there, not just those selling the same products,” said Wasserman. “For example, look at Amazon.com with two-day shipping. You might not have been selling the same product, but customers began to demand that service. Who else is driving a great CX that you can adopt to your own business?”
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